Stimulus to Aid Unemployed, Poor

By

Laura Meckler

Updated Feb. 12, 2009 4:21 p.m. ET

The economic-stimulus package's main goal may be to create jobs, but it would also provide billions of dollars in help for those who have already lost them. The package, which is headed for final votes in Congress Friday, would also provide new money for a host of safety-net programs that serve low-income and poor Americans.

The unemployed would qualify for an additional 20 weeks of unemployment benefits and, in the hardest-hit states, 33 more weeks. That would expand through 2009 federal aid that is set to expire next month. The package would also boost benefits by $25 a week.

States would win one-time grants if they agree to update their program's rules to make it easier for low-wage and part-time workers to qualify for unemployment assistance. Those changes, unlike other provisions, would be permanent.

Laid-off workers would get help paying for health-insurance premiums if they opt to remain in their former employers' plans, which can be prohibitively expensive. Under the stimulus package, the government would pay 60% of the premium for up to nine months.

In addition, the measure would extend Trade Adjustment Assistance health benefits to at least 160,000 more workers who lose their jobs due to increased imports or factories moving overseas.

The package would provide new federal money for the preschool and infant programs Head Start and Early Head Start; increased food-stamp benefits; and one-time, $250 payments to seniors, disabled veterans and participants in the Supplemental Security Income program for disabled Americans with very low incomes.

Changes to the tax code would help poor families. One would make additional very low-income families eligible for the $1,000 per-child tax credit. Another would expand the Earned Income Tax Credit, by boosting benefits for families with three or more kids and reducing a penalty for working parents who are married.

The package would provide a total of $87 billion to state Medicaid programs. The provision was designed to provide fiscal relief for strapped states budgets, but it would also allow states to avoid cutting health benefits for the poor.

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